The possibility of a new hotel at city-owned land off Parkview Avenue moved a step closer to fruition Tuesday night as the City Council directed staff to put out a request for proposals.
The council asked staff to evaluate the possibilities of building a hotel, offices or apartments on the property, which currently provides overflow parking for the Manhattan Village Mall, at its Aug. 18 meeting at Mayor Mark Burton’s suggestion.
Tuesday night, Burton again urged his colleagues to support the development of the property. Â He argued that a hotel would be best for the city, which has declining sales tax revenue.
“I think if we don’t move quickly, we’re going to miss a golden opportunity,” said Burton, noting that the Marriott, which lies just east of the site, was for sale.
“We need to seize this opportunity to secure the future of our city economically. This is a no-brainer, in my mind.”
Burton called the site a “perfect location” due to its proximity to the Manhattan Towers office complex, which sold for $96 million in July, and the mall, which he said could benefit from more patrons and is planning a renovation.
“It will help activate the Rosecrans corridor,” he said. “It will help drive Silicon Beach here.”
Representatives from two companies the city paid $55,000 to vet possible uses presented their findings at the meeting.
Both PKF Consulting and Keyser Marston Associates said a hotel would generate the most income for the city, bringing in over $1 million annually. Their calculations were based on a 150-room hotel that would charge an average of $220 per night.
“This is a very, very strong hotel market currently,” said Bruce Baltin, a managing director at PKF Consulting.
Manhattan Beach’s average occupancy of hotel rooms was 86 percent compared to the national average of 65 percent, which is the highest it’s been since statistics started being kept in 1987, according to Baltin.
At the request of the council, PKF also analyzed the feasibility of constructing hotels at other sites around the city, including at Rosecrans and Highland avenues, at the Von’s supermarket site downtown, and at the Fry’s Electronics site near the Manhattan Village Mall. A 40-room expansion at the Shade Hotel in the Metlox Plaza was also considered.
The council, however, decided to wait to evaluate the sites until the city hired an economic development director.
Several people, including Councilmember Wayne Powell, the only member to vote against the motion, criticized the fact that the city hired a company specializing in hotel development to perform the analysis.
“The direction was to look at possible uses for the site, yet staff did not look at other uses but hired hotel specialists to decide what happens to the site,” wrote resident Janet Murphy in an email to the council.
However, Councilmembers Tony D’Errico and Amy Howorth said the move was appropriate.
“KMA looked at the three uses we asked them to look at — the ones that are going to make the most sense, in my mind,” said D’Errico.
Powell and Councilmember David Lesser said other uses, including retaining the site as open space or building senior housing, should be considered.
“Another thing that’s troubling is we’re looking at this from a mere revenue standpoint,” said Powell. “Oftentimes we have uses that are not maximizing revenue but are other commendable uses.”
The council directed staff to look at those two specific uses in its final motion.
Powell asked that a public workshop be held to gather community input, such as the one recently held regarding the development of a Specific Plan for downtown, and that the residents of the Manhattan Village Senior Villas adjacent to the site, who spoke out against the proposal in August, be notified.
At the suggestion of the consultants, the council agreed to a two-step process of a request for qualifications, which would identify potential developers, and a request for proposals. City Manager Mark Danaj said that staff would come back to the council with the results. ER
